Debt Consolidation Calculator

Debt consolidation combines multiple debts into one loan with a single monthly payment. Common methods: personal loans, balance transfer credit cards, home equity loans, or HELOCs. The goal is typically to lower interest rates, reduce monthly payments, or simplify finances.

Debt consolidation is good if you: 1) Qualify for a lower interest rate, 2) Can afford the new payment, 3) Address the spending habits that caused debt. It is NOT good if you will rack up new debt afterward or if fees outweigh savings. It does not reduce debt—it restructures it.

0% balance transfer cards are best for small debts you can pay off in 12-18 months. Personal loans work for larger debts or longer payoff periods. Home equity loans offer low rates but put your home at risk. 401(k) loans are rarely recommended due to retirement risk.

Initially, applying for a consolidation loan causes a small dip (hard inquiry). Long-term effects depend on your behavior: positive if you make payments on time and reduce credit utilization; negative if you close old accounts (reduces credit history) or rack up new debt.

Balance transfers can be completed in 1-2 weeks. Personal loans typically fund in 1-7 days after approval. The payoff timeline depends on your debt amount and payment size. Most consolidation loans have terms of 2-7 years. Aim to pay off faster than minimum payments to save interest.